The Best Way to Invoice Clients

If you've got the right system in place, invoicing your clients is exciting
and fun. It's invigorating to tally up your hours and click 'Send', politely
asking someone for hundreds or thousands of dollars in exchange for your
services.

But if you don't have the right system in place, invoicing can be a confusing
mess. I've received invoices from vendors that look like they were made in
Microsoft Word. If this is you, fear not: Let's get your invoicing up to
snuff.

Using invoicing software is essential. It ensures you are tracking every dollar
your clients owe you and whether or not they've paid. It also makes
your end-of-year tax filing a breeze. Okay, not a breeze. Maybe a mild wind.

How to Pick Invoicing Software

When shopping for invoicing software, be sure it has the following functions:

The ability to track your time worked and allocate it to billable projects

You'll want to be able to input your hours directly into your
invoicing application and have it generate an invoice from the billable hours
logged. This way, you're not tracking hours separately and there's less room
for error.

The ability to track expenses for reimbursement

You'll want to be able
to track the expenses you accrue on behalf of your clients and have them
appear as line items on your next invoice. These could be things like
special software, commercially-licensed images or video, or equipment you
needed for your client's job.

The ability to send a client an invoice for the hours you've logged

Being able to click 'Create Invoice' and have it auto-populate based on your
uninvoiced hours removes the administrative overhead of manually transcribing
your hours and sending an email. Because you're a hustler and will be sending
a ton of invoices, we might as well streamline the process!

The ability to generate reports about your invoice history

When tax time finally comes around, you'll want to be able to export all of
your invoice data so you can report your earnings and accurately pay your
taxes.

My favorite invoicing software at the moment is the fabulously simple and
intuitive
Harvest. To me, the sign a tool is fantastic is
when you don't notice you're using it. For me, Harvest makes that cut. Oh, and
it has all the features above.

Invoicing Etiquette

Bill the time you work. Always.

As freelancers, we're constantly juggling multiple projects and often have to
address multiple clients in a single day (sometimes within the hour!). It takes an
average of 23
minutes to regain your focus after being
interrupted. So if your client calls you with a quick 5-minute question,
they're costing you 28 minutes of productivity! It was your decision to pick
up the phone, but it's important to shield your business from the risk
incurred in doing so.

Even if it's just 5 minutes, be sure to bill your
client for the time and itemize the call on your invoice.

Be honest and transparent.

Send invoices regularly with praise.

Think of the last time you received a bill from a small business. Maybe it was your
doctor or auto mechanic. Chances are, you felt a slight feeling of annoyance
knowing you now owe someone money. No one likes to settle their debts. That's
why it's imperative you take steps to make your clients comfortable with
paying you.

First, send your invoices on a regular and agreed upon schedule. If your
client is an individual, sending invoices weekly or biweekly is best. It
ensures they won't feel alienated by the large dollar amounts and they'll be
better equipped to plan their finances because they'll know how much they owe
you. Better to do that than to surprise them all at once at the end of the
month.

Second, always add a note with praise for whatever work you both conducted
during that billing cycle. I usually say something like this:

Hi Tom:

Attached is the invoice for this week's work.
It was such a blast to implement that new chat feature last week. I'm
so excited we're working together and can't wait until we launch!

I transformed my freelance web development business into a well-oiled wealth-building machine, and I want
to share how I did it. And if you're successful using your freelance income to increase your net worth, I'd love to
hear from you. Post a comment and share what you're doing differently!